With declining oil prices impacting major planned projects in the GCC, Kuwait’s mega refinery project which was supposed to be awarded early this year is witnessing further delays as the bids submitted were over budget by USD 4bn. Currently,KNPC is negotiating with contractors and is mulling the re-tender of package four (storage tanks and pipelines) and package five (marine facilities).

In the meanwhile, KNPC and Kuwait’s Petroleum Industries Company (PIC) took a decision to consider integrating the Al Zour Refinery (ZOR) project with a petrochemical complex. The petrochemical facility in talks is Kuwait’s Olefins Complex 3 which was on hold till late last year and is currently being re-evaluated in anticipation of potentially being revived.

The feasibility study to integrate the two plans will start in May and will be followed by KNPC evaluating if the extra budget will be justifiable for Kuwait’s plan to boost output capacity. The assigned consulting firm (KBC Advanced Technologies) will submit its results in 3-4 months, post which KNPC will decide the future of its refinery.

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